Policy Brief

Issue No: 4/2020 April 2020

A vehicle to articulate development issues and foster dialogue

Articulating the Pathways of the Socio-Economic Impact of the Coronavirus

(COVID-19) Pandemic on the Kenyan Economy1
Summary - This policy brief assesses the possible vulnerabilities and impacts on Kenya of the COVID-19 pandemic.
Although it is too early to predict the socio-economic impact of the COVID-19 pandemic on the Kenyan econ0my,
this policy brief uses an adapted World Bank conceptual and methodological framework which was used to analyse
the economic impact of the Ebola virus disease in West Africa 2014-2016 to identify the pathways of the CODIV-
19 pandemic impact on the economy, poverty and inequality, women and girls, refugees, internal displaced persons
(IDPs) and migrants, education, food security and nutrition and governance and security. There has already been
adverse effects of the COVID-19 pandemic on the several sectors of the economy in particular; tourism, agriculture,
manufacturing and trade putting people’s jobs and livelihoods at risk. The policy brief argues that considering the
adverse socio-economic impacts of the COVID-19 pandemic on the health and livelihoods of families and
communities, in particular the most vulnerable groups which will regress progress across the Sustainable
Development Goals (SDGs), policymakers, should adopt a whole of government and society approach to lessen
the adverse impacts.

1. Introduction
On 31st December 2019, the World Health Organization (WHO) was informed of a cluster of cases of pneumonia
of unknown cause detected in Wuhan City, Hubei Province, Peoples’ Republic of China. This was subsequently
confirmed as an outbreak of a new type of coronavirus, 2019 novel Coronavirus (2019-nCOV) by the National
Health Commission, Peoples’ Republic of China and the WHO. As of 2nd April 2020, the Coronavirus
Worldometer shows that the number of infected cases globally was 935,957 with recorded 47,245 deaths, and
194,298 recovered patients2. In Kenya, the number of infected cases is eighty one (81) with one (1) death and
three (3) recovered patients.

1This policy brief is an output of the Strategic Policy Advisory Unit (SPAU) in the UNDP Kenya Country Office and UNRCO in collaboration with FAO,

UNICEF, UN Women, IOM, UNHCR, UN Habitat and UNESCO. This policy brief was prepared to stimulate policy debate on the socio-economic
impact of the COVID-19 pandemic on Kenyan economy and to inform UN programming and Government of Kenya response to the pandemic.

The views expressed in this policy brief are those of the SPAU, and do not represent the views of UNDP, the respective UN agencies and United
Nations or any of its affiliate organizations

For more information, please contact the Unit at the following email: policyunit.ken@undp.org

2https://www.worldometers.info/coronavirus/#countries (last updated: April 2nd , 2020, 02:57 GMT). The analysis in this policy brief is based on
data available as at 2nd April 2020.
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COVID-19 being a novel virus and as the outbreak continues to evolve, research is ongoing to better understand
its dynamics of transmission and improve case management among others. COVID-19 has potential to cause
many infections through human-to-human transmission and lead to a significant number of severe cases that
could overwhelm the health care system, and a substantial number of deaths. However, if persons infected are
detected in a timely manner and rigorous infection control measures applied, the likelihood of sustained
human-to-human transmission can be reduced.

Public health experts have consistently warned that the novel coronavirus outbreak presents a unique public
health threat to the African continent. Gilbert, Pullano, Pinotti, et al. (2020) use two indicators to determine
the capacity of countries to detect and respond to cases: preparedness, using the WHO International Health
Regulations Monitoring and Evaluation Framework; and vulnerability, using the Infectious Disease
Vulnerability Index. Based on their analysis, Egypt, Algeria, and South Africa had the highest importation risk,
and a moderate to high capacity to respond to outbreaks. Nigeria, Ethiopia, Sudan, Angola, Tanzania, Ghana,
and Kenya had moderate risk with variable capacity and high vulnerability.

Furthermore, it is widely thought the economic fallout for the continent is likely to be severe and long-lasting.
Many of its countries have a high dependence on commodity exports to China, relatively weak sovereign
balance sheets, high debt burdens and volatile currencies, among numerous other external fragilities. The
disease’s negative impact on the world economy has already translated into a decline in demand for the
primary products that Africa exports, such as oil from Angola and Nigeria and rare minerals from Democratic
Republic of the Congo. The UN Economic Commission for Africa estimates Africa’s growth will drop by 1.4%
from 3.2% to 1.8 % as a result of the coronavirus.3 Among other things, the decline is due to disruption of global
supply chains and a crash in oil prices that will cost up to US$65 billion in export revenues.4 Furthmore, tourism
has been adversely affected, as international travelers stay home, hurting the economies of South Africa and
Kenya, among others. Investors, confronted with a litany of unknowns about the disease and its consequences,
are fleeing from emerging markets, at least for the time being.

This policy brief assesses the possible vulnerabilities and impacts on Kenya of the COVID-19 pandemic.
Although it is too early to predict the socio-economic impact of the COVID-19 pandemic on the Kenyan
econ0my, this policy brief uses an adapted World Bank conceptual and methodological framework which was
used to analyse the economic impact of the Ebola virus disease in West Africa 2014-2016 to identify the
pathways of the CODIV-19 pandemic impact on the economy, poverty and inequality, women and girls,
refugees, internal displaced persons (IDPs) and migrants, education, food security and nutrition and
governance and security. There has already been adverse effects of the COVID-19 pandemic on the several
sectors of the economy in particular; tourism, agriculture, manufacturing and trade putting people’s jobs and
livelihoods at risk. The policy brief argues that considering the adverse socio-economic impacts of the COVID-
19 pandemic on the health and livelihoods of families and communities, in particular the most vulnerable
groups which will regress progress across the Sustainable Development Goals (SDGs), policymakers, should
adopt a whole of government and society approach to lessen the adverse impacts.

3 United Nations Economic Commision For Africa (13 March 2020). “ECA estimates billions worth of losses in Africa due to COVID-19 impact,”
Available at https://www.uneca.org/stories/eca-estimates-billions-worth-losses-africa-due-covid-19-impact
4 ibid.

2
 2. Pathways of the Socio-Economic Impact of the COVID -19 Pandemic
The socio-economic impact of the COVID-19 epidemic operates through two distinct channels (see figure 1.1).
First are the direct and indirect effects of the sickness, which results from when an income-earner in the
household falls ill, the ratio of active members to dependents falls. The effects may be compounded by lost
earnings and taking care of the ill family member, or funeral costs upon death. Ill-health and limited resilience
capacities can create multiplier effects. One study of eleven (11) countries in Sub-Saharan Africa and South and
Southeast Asia found that in the absence of health insurance or other forms of universal health coverage,
responses to health shocks by people in poverty or near the poverty line commonly included distress sales of
assets and taking out loans from informal moneylenders, sometimes at exploitative rates.5 Thus, the coronavirus
will be another source of impoverishment and reinforce existing factors, in turn limiting the ability of vulnerable
households to escape from – and stay out of – poverty. 6

Second are aversion behaviour effects resulting from the fear of catching the virus, which in turn leads to a fear
of association with others and reduces labor force participation, closes places of employment, disrupts
transportation, motivates some governments to close borders and restrict entry of citizens from afflicted
countries, and motivates private decision makers to disrupt trade, travel, and commerce by canceling
scheduled commercial flights and reducing shipping and cargo services. As depicted in the figure 1.1, this
aversion behaviour is through three sources:
‐ Governments impose bans on certain types of activities, as when the Government of China orders
factories to shut down or Italy closes most shops throughout the country or the Kenya Judiciary’s
suspension of court hearings across the country starting Monday, March 16, 2020 for two weeks in order
to allow for further consultations and to design appropriate measures to prevent the spread of the
coronavirus7 which will have an adverse effect on the justice system.
‐ Firms and institutions (including schools and private companies) take proactive measures to avoid
infection. Business closures -- whether through government bans or business decisions -- result in lost
wages for workers in many cases, especially in the informal economy where there is no paid leave. After
the confirmation of the first case on 13 March 2020, Kenya introduced various restrictions such as the
entry of foreigners from countries that have confirmed coronavirus cases, working at home and closing
of learning institutions.8 Other restrictions have since been placed by 47 individual governors in their
respective counties. Barely a few days into the restrictions, small-scale traders in Nairobi were already
filling the effects of coronavirus-induced hardships. 9 Traders who were interviewed by the Standard
Newspaper showed their frustration with the restrictions:

“Normally by 10am, I should have made at least Ksh400. I have only made Ksh80 since morning today.
People are hardly coming into the city,” (James Mulei, a shoe shiner near the Kenya National Archives,
Nairobi).

5 Diwakar, V., and Shepherd, A., (2018). “Health, Resilience and Sustainable Poverty Escapes: Synthesis,” Available at
https://dl.orangedox.com/duddnR
6 Diwakar, V., and Shepherd, A., (2018. “Sustaining Escapes from Poverty,” ODI Working Paper 539, Available at
https://www.odi.org/sites/odi.org.uk/files/resource-documents/12471.pdf
7 Manyibe, E., (15 March 2020). “Judiciary Suspends Court Sessions Over Coronavirus Scare,” Available at https://www.kenyans.co.ke/news/50854-

court-sessions-suspended-over-coronavirus-scare
8 Malingha, D., (15 March 2020). “Kenya Restricts Foreign Travel, Suspends School on Coronavirus,” Available at
https://www.bloomberg.com/news/articles/2020-03-15/kenya-restricts-foreign-travel-suspends-school-on-coronavirus
9 Gathura, G., (18 March 2020). “Kenyans should brace for a long lockdown ahead,” Available at
https://www.standardmedia.co.ke/article/2001364648/kenyans-should-brace-for-a-long-lockdown-ahead
3
 “I hope this does not go on for long, otherwise we are going to starve.” (Jane Mulinge, who supplies
vegetables to a now-closed primary school in Embakasi, Nairobi).

Most of the traders who were interviewed by the Standard Newspaper in Nairobi hoped that the lockdown
would have to be lifted within 30 days.10 However, going with what is being witnessed worldwide, the crisis
could linger on longer.

‐ Individuals reduce trips to the market, travel, going out, and other social activities. A study by the Kenya
Private Sector Alliance (KEPSA) 2020 entitled Business Perspectives on the Impact of Coronavirus on
Kenya’s Economy identified cancellation of business-related travels as one of the channels businesses
will be affected by the coronavirus.

This includes local travel agents receiving cancellations from tourists/clients abroad who are
cancelling their trips to Kenya due to the outbreak of the virus. For example, after the cancelation
by ITB Berlin, the largest tourism expo in the world, the tourism sector is bound to suffer huge losses.
July - September is the peak season in Kenya and there are already fears that tourists who had
booked to travel for the migration (wild animals) will not travel. Equally, many clients are now
changing their plans to book due to uncertainty. Impact of this continues to bite the tourism sector.
(KEPSA, 2020:4)

Figure 1. 1: Channels of Potential Socio-economic Impact of the Covid-19 Pandemic11

10ibid.
11Adapted from Evans, D., and Over, M., (2020). “The Economic Impact of COVID-19 in Low- and Middle-Income Countries,” Available at
https://www.cgdev.org/blog/economic-impact-covid-19-low-and-middle-income-countries
4
Measures taken by Kenya and other countries to restrict travel would have huge impact on the travel and
tourism sector. The World Travel and Tourism Council (WTTC) figures show that in 2018, travel in tourism in
Kenya grew 5.6% and contributed Ksh790 billion to the economy. It also created 1.1 million jobs. The tourism
industry is taking the biggest hit given the measures already taken by the Government in shutting down its
borders in an attempt to lock out i the coronavirus and contain it.

According to the Kenya Tourism Sector Performance Report for 2019, total arrivals increased 116 basis points
to record 2.04 million compared to 2.03 million recorded in 2018. Arrivals from the US grew 9% in 2019 to
245,437 arrivals, up from 225,157 in the previous year followed by Uganda and Tanzania at 223,010 and 193,740
respectively. Other key sources of tourists were the UK (181,484), India (122,649), China at (84,208), Germany
(73,1509), France (54,979), Italy (54,607) and South Africa (46,926).

With these countries affected by the coronavirus and Italy in particular reeling from the coronavirus pandemic,
the tourism economy, especially at the Coast, is expected to be hit hard. Some hoteliers have started sending
staff home as most hotels have remained empty.12 Kenya Tourism Federation (KTF) has reported that some
hotels on the Coast have occupancy rates below 10%, necessitating close down and sending staff home on
unpaid compulsory leave.

These aversion behaviour actions affect the main sectors that contribute to the country’s GDP as shown in
figure 1.2. -- the health sector, agriculture, manufacturing, retail and other services, trade and transportation,
education, etc. These in turn translate into reduced income both through the supply side (reduced production
drives up prices for consumers) 13 and the demand side (reduced demand from consumers hurts business
owners and their employees). These short-term economic impacts can translate into a decrease in long-term
growth in Kenya.14

12 Wambu, W. (15 March 2020). “Tourism, aviation hit hard by impact of coronavirus.” Available at
https://www.standardmedia.co.ke/business/article/2001364251/tourism-aviation-hit-hard-by-impact-of-coronavirus
13 The Competition of Authority of Kenya (CAK) recently ordered Cleanshelf Supermarket to contact and refund all customers who purchased hand

sanitisers above the normal retail price. Through a press release, CAK indicated that the supermarket adjusted the prices of the Tropikal hand
sanitisers (500ml) on March 15 due to the high demand following reports of coronavirus in Kenya. Cleanshelf Supermarkets normally retails the
specific hand sanitizers as Sh800. However, the CAK has determined that the retailer on March 15 sold the same batch of product to consumers at
varying amounts above Sh800/=, including Sh1000/=, with the prices increasing within hours (see
https://www.standardmedia.co.ke/business/article/2001364707/president-uhuru-warns-traders-against-hiking-prices)
14 In the recent history of infectious disease outbreaks such as the SARS (severe acute respiratory syndrome) epidemic of 2002–04 and the H1N1

(swine flu) epidemic of 2009, aversion behavioural effects are estimated to have been responsible for as much as 80 or 90 percent of the total
economic impact of the epidemics (Lee and McKibbin 2003).
5
 Figure 1.2: Kenya's Sectors Contribution to GDP in 2018 (%)

Information & Communication

Education
Public Administration & Defense
Construction
Financial & Insurance Activities
Real Estate
Wholesale, Retail Trade & Repairs
Manufacturing
Transportation & Storage
Agriculture, Forestry & Fishing

- 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0

Source: KNBS (2019)., Economic Survey 2019

As the health sector soaks up more resources and as people reduce social activities, countries invest less in
physical infrastructure. As schools close, students lose opportunities to learn (hopefully briefly) but more
vulnerable students may not return to the education system, translating to lower long-term earning
trajectories for them and their families, increased inequality and reduced overall human capital in the economy.

For example, during the school closures of Sierra Leone’s Ebola outbreak, “a reported increase in adolescent
pregnancies during the outbreak has been attributed largely to the closure of schools. 15 ” (UNDP 2015).
Bandiera et al. (2019) find that in villages highly disrupted by Ebola, girls were “10.7% more likely to become
pregnant, with most of these pregnancies occurring out of wedlock.” Adolescent mothers are less likely to
return to school, and their children will likely have fewer health and educational investments. Further, health
workers are on the front lines of epidemics and losing some of them to the disease -- especially in countries
where they are already in short supply -- can lead to worsening health conditions in the long-term, such as
maternal and infant mortality. These all have poverty implications well beyond the humanitarian implications
such as greater inequality, negative impact on human rights, expansion of the informal sector and regression
of progress across the SDGs.

3. Impact on the Economy

The COVID-19 pandemic has the potential to cause a global economic recession. According to the Organization
for Economic Cooperation and Development (OECD) (2020), annual global GDP growth is projected to drop to
2.4% in 2020, with growth possibly even being negative in the first quarter of 2020 due to COVID-19 pandemic.
Prospects for China have been revised markedly from an initial 5.7% growth estimate in November 2019 to a
much lower 4.9% in March 2020.The adverse impact on finance markets, disruption of global supply chains,
tourism sector and other sectors of the economy will have an adverse effect on the Kenyan economy.

‐ Financial markets: Trading at the Nairobi Securities Exchange (NSE) was halted on 13 March 2020 after
the NSE all share index fell by more than 5%16, wiping out Ksh120 billion off investors’ portfolios due to

15There were also reports of increased domestic violence and sexual violence.
16 Tradingin the NSE 20 was halted on 13 March 2020 after the NSE 20 dropped more than 5%, as per the provisions of Rule 9.4.1 (ii) of the NSE
Equity Trading Rules.
6
 panic selling.17 The previous day on 12 March 2020, it lost KSh122 billion, meaning that in the two days,
coronavirus fears had wiped out Ksh242 billion as foreign traders disposed of their equity holdings to
purchase gold and fixed income securities. When the first COVID-19 case was reported in the country,
the stock markets declined with stocks such as Safaricom and Kenya Commercial Bank (KCB) declining
by 5.4% and 7.0%, respectively, in one day.

Although Government T-bills remained oversubscribed during the week ending 13 March 2020 with the
subscription rate at 264%18, all yields on shorter-dated government papers between the 1 and 7 years recorded
year-to-date (ytd) return declines. Furthermore, the Eurobond yields has increased significantly, indicating that
investors are now attaching a higher risk premium on the country due to the anticipation of slower economic
growth due to the COVID-19 pandemic.19 This will make it costly for Kenya to raise capital on the Eurobond
markets, yet the fiscal pressures are already intense.20

The fiscal pressures will be exacerbated by the immediate problem of an unprecedented health crisis morphing
into a social-economic problem which will be catalogued through a slump in production; disruption of supply
chains, shortage of goods; mass unemployment; loss of incomes and a vast increase in the number of
dependents. The ensuing loss of government revenues and pressure for the government to cushion citizens
from the harsh reality of massive losses of incomes poses a huge strain on the exchequer. The Government
announced tax relief measures (lower VAT and reduced Corporate Income Tax) on 25 March 2020 to encourage
continued production of goods and services and protect jobs.21 In addition, the Government also announced
various relief measures targeting employees and citizens at the bottom of the pyramid especially in urban
areas. As these measures will result in considerable loss of government revenue, the government will have to
reassess the budget deficit target for fiscal year (FY) 2019/20.22 This will result in a freeze in development
projects as the funds will be diverted towards the fight against the coronavirus23.

‐ Aviation industry: The International Air Transport Association (IATA) estimates that airlines globally are
set to lose up to Ksh11.3 trillion (US$113 billion) in passenger revenues if the coronavirus pandemic is
protracted. Kenya Airways estimates that it is losing at least Ksh800 million a month, noting that the
situation could change more dramatically in the coming days as more restrictions are implemented in
global travel. Already Kenya Airways instituted measures including reducing the salaries of all staff by
50% and 80% for the CEO24 and sending non-critical staff on annual leave immediately and cancelling
65% of their flights and putting 50% of aircraft on long-term storage. In addition, domestic air operators
have requested the Government to provide Ksh3 billion to cushion already struggling industry due to
passenger decline as a result of COVID-19 pandemic.

17 Otini, R., (14 March 2020). “NSE suspends trading as coronavirus fears wipe out Sh240 billion,” Available at
https://www.standardmedia.co.ke/business/article/2001364144/nse-suspends-trading-as-coronavirus-fears-wipe-out-sh240-billion
18 Due to investors moving into the fixed income market to avoid uncertainty.
19 According to Reuters, the yield on the 10-year Eurobond issued in June 2014 increased by 2.7% points to 7.2%, from 4.5% recorded the previous

two week ago while the yields on the 10-year and 30-year Eurobonds issued in 2018, increased by 2.6% points and 1.2% points to 8.3% and 8.4%,
respectively, from 5.7% and 7.2% recorded previous two weeks ago. Yields on the 7-year and 12-year Eurobonds issued in 2019 increased by 1.2%
points and 2.8% points, to 6.6% and 9.3%, respectively, from 5.4% and 6.5% recorded the previous two week ago.
20 National Treasury figures show that the budget deficit and public debt as a percentage of GDP in FY 2019/2020 were 7.7% and 61.6%, respectively.
21 https://www.president.go.ke/2020/03/25/presidential-address-on-the-state-interventions-to-cushion-kenyans-against-economic-effects-of-
covid-19-pandemic-on-25th-march-2020/
22 National Treasury had projected a budget deficit of 4.9% in FY 2020/21.

23 Ayaga, W., and Omondi, D., (2 April 2020). “Development cash to be diverted to war on coronavirus,” Available at
https://www.standardmedia.co.ke/article/2001366526/development-cash-to-be-diverted-to-war-on-virus
24 Ombati, C., (24 March 2020). “KQ effects State's ban on flights,” Available at https://www.standardmedia.co.ke/article/2001365395/kq-effects-

state-s-ban-on-flights
7
 ‐ Transport and shipping: Business at the Port of Mombasa has been significantly affected following the
cancellation of thirty seven (37) ships scheduled to dock in the month of March while the fate of one
hundred and four (104) others remain uncertain following an outbreak of coronavirus pandemic.
According to the Kenya Ports Authority (KPA), apart from cancellation of the ships docking, a number
of vessels which docked in February reported blank arrivals affecting cargo throughput at the port. This
has resulted in business losses that have been acutely felt in the supply chain, with the Standard Gauge
Railway (SGR) which haul the cargo directly from the Port of Mombasa to the Inland Container Depot
(ICD). According to a weekly report by the KPA from 27 February to 4 March 2020, the number of SGR
freight registered declined from an average of sixty (60) in November and December 2019 to forty (40)
trains in early March 2020. The decline in cargo is a big blow to Kenya as it expected to collect more
revenue from SGR services and pay the Ksh10 billion monthly loan to China's Export and Import (Exim)
Bank.

‐ Disruption of global supply chains: The spread of the coronavirus has disrupted the global supply chains.
Kenya’s imports from China account for approximately 21% of total imports and with the current
lockdown, activities within the manufacturing sector are likely to be disrupted (see table 1.1 and figure
1.3).25 The low supply of imports from China as well as South Korea especially in terms of electronics
could result in an increase in prices. Local traders have already indicated that the prices of electronics,
clothes, and furniture many of which are imported from China are likely to increase.26

Figure 1.4 shows that the bulk of Kenya’s exports are exported to countries which are affected by the COVID-
19 pandemic. This will have an adverse effect on export earnings due to weak demand in these markets. The
COVID-19 pandemic has already affected the country’s exports of horticulture and agricultural goods to
Europe, which has some of the hardest-hit cities in France and Italy mainly because of reduced consumer
spending as well as shutdowns in major markets. The Agriculture and Food Authority (AFA), a horticulture
regulator in the country, has indicated that Kenya’s earnings from horticulture exports including flowers, fruits
and vegetable, fell by 7% in 2019 to Ksh142.72 from Ksh154.7 billion, mainly due to lower prices of flowers at
the auction in the Netherlands. The situation is set to worsen due to the coronavirus pandemic. According to
the Kenya Flower Council (KFC), out of the 150,000 employees, flower firms have sent home 30,000 temporary
workers and 40,000 permanent employees on compulsory leave as there is no demand for flowers in Europe
which absorbs 70-75% of the exports.27 The industry is experiencing Ksh20 million daily revenue losses as a
result of cancellation of orders and border closures from major markets according to KFC. The country’s fresh
produce export market has dropped by 46% following the lockdown in some European markets.28 The lower
consumer demand for flowers and other horticulture exports will affect mostly women who account for 75% of
the workforce in the horticulture sector in Kenya.

Furthermore, COVID-19 pandemic would cause a shortage of intermediate goods used to manufacture
products that are exported. The decline in business activity and fall in new orders is already being felt.

25 Both table 1.1 and figure 1.2 show that the bulk of Kenya’s imports are from the countries which are affected by the COVID-19 pandemic.
26 Theuri,P., (15 March 2020). “Traders begin to bear brunt of coronavirus,” Available at
https://www.standardmedia.co.ke/business/article/2001364260/traders-begin-to-bear-brunt-of-coronavirus
27 The remaining 30% is exported to US and Asian economies such as China, UAE and Japan which have also been shut down due coronavirus

lockdown.
28 Gitonga, A., ((22nd March 2020). “Fresh produce exports dip 46pc on European markets lockdown,” Available at
https://www.standardmedia.co.ke/business/article/2001365140/fresh-produce-exports-drop-46per-cent-due-to-a-lockdown-in-europe
8
According to Stanbic Bank’s Monthly Purchasing Manager’s Index (PMI) report, the PMI declined to 49.0 in
February 2020 from 49.7 recorded in January 202029 due to a decline in business conditions.30

A survey by the Kenya Private Sector Alliance (KEPSA) (2020) on the coronavirus pandemic impact on Kenya’s
economy indicates that 61% of businesses had been affected by the measures being taken around the world to
contain the virus. The survey featured ninety five (95) locally owned businesses spanning seventeen (17) sectors
of the economy. In addition, there were thirty two (32) manufacturers surveyed by the Kenya Association of
Manufacturers (KAM) with the findings integrated into the KEPSA report. According to the report, most
businesses expect to be disrupted in these various ways:
‐ Most companies foresee a situation where they will have to ask employees to work from home thus
negatively affecting businesses in the service sector,
‐ Stock-outs and delayed deliveries due to the lockdown,
‐ Reduced demand for export products,
‐ Increased cost of goods which will consequently increase the overall cost of production,
‐ Reduced capital flows, restrictions on travel, and reduced staff time,
‐ Difficulty in obtaining credit from financial institutions as well as reduced ability to meet their loan
interest payments, and,
‐ Slowed investment appetite from foreign and local investors.

‐ The macroeconomic impacts on the key sectors of the economy: Table 1.2 shows the macroeconomic
impact on the economy. The risk on four (4) sectors is high, two (2) moderate and 2 low, showing a
significant impact of the COVID-19 pandemic on the Kenyan economy.

‐ Exchange rate volatility: COVID-19 is already having an impact on the exchange rate. The Kenya shilling
weakened to a five-month low on 17 March 2020. The local currency was traded at 103.38 against the
dollar at the close of business, the lowest since October 30 2019, when it exchanged at 103.40 to the
US$.31 The shortage of imports from China for instance, which accounts for an estimated 21% of the
country’s imports, is expected to exert pressure on the exchange rate as local importers look for
alternative import markets, which may be more expensive. This is bound to increase demand for the
dollar from merchandise importers and result in an exchange rate depreciation.

‐ Diaspora remittances: According to the 2019 Migration and Development report remittances rose from
$1.962 billion billion) in 2017 to $2.855 billion in 2019, an increase of over $892 million (Sh75 billion) and
equivalent to 2.9% of Kenya’s GDP. As outward remittances decline in tandem with the nominal GDP
(in US dollar terms) of the source countries, the COVID pandemic would result in a decline of diaspora
remittances due to reduction in disposable income. Central Bank of Kenya monthly statistics on
diaspora remittances indicate a decline of 15.6% from US$259.4 million to US$219.0 million between
January and February 2020. This coupled with increased prices of household items especially in Europe
and North America is likely to lead to further reduction in remittances in 2020.

29 See Stanbic Bank Kenya PMI (4 March 2020) Available at

https://www.markiteconomics.com/Public/Home/PressRelease/e44c48434816467a831ed2326df974a1
30 A reading of above 50 indicates an improvement in the business environment, while a reading of below 50 indicates a worsening outlook.
31 Omondi, D., (18 March 2020) “Shilling down to lowest level since October,” Available at
https://www.standardmedia.co.ke/business/article/2001364640/shilling-down-to-lowest-level-since-october
9
 ‐ Monetary policy: Vis-à-vis monetary policy, the Monetary Policy Committee (MPC) cut the Central Bank
Rate (CBR) from 8.25% to 7.25 on 23 March 2020 to cushion the economy from the coronavirus
pandemic.32 The MPC also reduced the Cash Reserve Ratio (CRR) from 5.25% 4.25%, thus releasing
Ksh.35.2 billion as additional liquidity availed to banks to directly support borrowers that are affected
adversely by the coronavirus pandemic.33

The MPC anticipates that these monetary policy actions will support the emergency measures which were
announced by the CBK in a meeting with commercial banks on 16 March 2020 to mitigate economic effects of
the coronavirus pandemic on bank borrowers whose loan repayments were up to date as at 2 March 2020 which
included:34
‐ Banks will seek to provide relief to borrowers on their personal loans based on their individual
circumstances arising from the pandemic;
‐ To provide relief on personal loans, banks will review requests from borrowers for extension of their
loan for a period of up to one year and to initiate this process, borrowers should contact their respective
banks;
‐ Medium-sized enterprises (SMEs)and corporate borrowers can contact their banks for assessment and
restructuring of their loans based on their respective circumstances arising from the pandemic;
‐ Banks will meet all the costs related to the extension and restructuring of loans;
‐ To facilitate increased use of mobile digital platforms, banks will waive all charges for balance inquiry;
and
‐ All charges for transfers between mobile money wallets and bank accounts will be eliminated.

These monetary policy measures are expected to boost the economy. However, the shortage of imports on the
local market and domestic supply bottlenecks may lead to an increase in inflation and impact the efficacy of
these measures.

Based on the impact of COVID-19 on the global economy, disruption of supply chains and domestic production,
the CBK is forecasting a decline to a possibly 3.4% in 2020 from the previous forecast 6.2%,35 if the impact of
the coronavirus pandemic proves long lasting and more intensive.

4. Impact on Poverty and Inequality

Poverty remains high Kenya despite a decline in the poverty rate from 46.6% in 2005/06 to 36.1% 36 in 2015/16.37
Poverty rates remain above 70% in remote, arid and sparsely populated northeastern parts of Kenya. 38

32 Central Bank of Kenya (23 March 2020) “Press Release: Monetary Policy Committee Meeting,” Available at
https://www.centralbank.go.ke/uploads/mpc_press_release/765216187_MPC%20Press%20Release%20-
%20Meeting%20of%20March%2023,%202020.pdf
33 ibid.
34 Central Bank of Kenya, (16 March 2020). “Press Release: Emergency Measures to Mitigate the Impact on Bank Borrowers from the Coronavirus

Pandemic,” Available at https://www.centralbank.go.ke/uploads/press_releases/1908080057_Press%20Release%20-

%20Emergency%20Measures%20to%20Mitigate%20the%20Adverse%20Economic%20Effects%20on%20Bank%20Borrowers%20from%20the
%20Coronavirus%20Pandemic.pdf

35 Central Bank of Kenya (23 March 2020) “Press Release: Monetary Policy Committee Meeting,” Available at
https://www.centralbank.go.ke/uploads/mpc_press_release/765216187_MPC%20Press%20Release%20-
%20Meeting%20of%20March%2023,%202020.pdf
36 Using the US$1.90 2011 PPP, the poverty rate declined from 43.6% in 2005/06 to 35.6% in 2015/16 (World Bank, 2018).
37 Using the monthly adult equivalent total consumption expenditure per person below KSh 3,252 in rural and peri-urban areas and below KSh 5,995

in core-urban areas as national poverty lines (KNBS, 2018. Kenya Integrated Household Budget Survey (KIHBS), 2015/16).
38 ibid.

10
According to the 2019 Kenya Population and Housing Census there are about 19.5 million poor people in
Kenya; with 14 million, 1.3 million and 4.2 million living in rural areas, peri-urban and core-urban and informal
settlements, respectively. Poverty is also feminized. The 2015/16 Kenya Integrated Household Survey (KIHBS)
results show that 30.2% of female headed households are poor compared to 26.0% of their male
counterparts.39 The COVID-19 pandemic will exacerbate poverty, especially among female headed households
who constitute (30.2%) of the poor population.

Income inequality levels have not decreased significantly in recent years. Kenya’s Gini coefficient of 44.540 is
above the 2013 Sub-Saharan African average of 43.8.41 The latest KIHBS results also show that nationally, more
than half (59.4%) of total expenditure is controlled by the top most quintile (Q5) while the bottom quintile (Q1)
controls the least share of 3.6%. Thus, the COVID-19 pandemic will exacerbate income inequality.

The Kenya National Bureau of Statistics (KNBS) estimates that unemployment stands at 14.2% amongst youth
aged 20 – 24 years42. The formal sector currently generates about 20% of the jobs required to absorb the labour
force which is growing at 2.9% per annum.

Workers in the informal economy may not have the luxury of staying at home when they are sick without paid
sick leave. People living in or near poverty often lack disposable cash and cannot easily stockpile food in times
of pandemics. Hunger, malnutrition, pneumonia and other forms of health-related shocks and stresses
compound vulnerability to the COVID-19 pandemic and contribute to a vicious cycle of disease, destitution
and death.

Poverty can fuel contagion, but contagion can also create or deepen impoverishment. 43 The coronavirus
pandemic would increase poverty, inequality and unemployment due to its adverse impact on people’s jobs
and livelihoods in the key sectors of the economy. The lack of health insurance for most of the poor and people
who reside in rural and informal settlements would exacerbate poverty and inequality the later with respect to
access to health services.44 Currently, four out of every five Kenyans have no access to medical insurance and
that among the poorest quintile, only 3% have health insurance with disparities between rural and urban
populations, where rates of coverage are an average of 12% and 27% respectively.45

5. Impact on Women and Girls

COVID-19 should be expected to disproportionately affect women and girls in Kenya, although Wenham,
Smith, and Morgan (2020) suggest that women appear to be less likely to die from the COVID-19 pandemic:

39 The female labour participation rate (75.9 percent) is lower than the male labour participation rate (79.2 percent) (KNBS, 2018. Labour Force Basic

Report, 2018)
40 ibid.
41 World Bank, 2014
42 KNBS, (February 2020). Quarterly Labour Force Survey, October to December 2019, Available at https://www.knbs.or.ke/?wpdmpro=quarterly-

labour-force-report-forth-quarter-2019

43 Partners in Health (27 January 2016). “Study Finds Poverty Spread Ebola,” https://www.pih.org/article/study-finds-poverty-accelerated-ebola
44 UNDP Strategic Policy Advisory Unit, (2017). “The Healthcare System in Kenya: Is Health Financing Working” Policy Brief, Issue No.4/2017, UNDP
Kenya, Nairobi.
45 http://www.health.go.ke/kenya-prioritizes-universal-health-coverage/

11
 Emerging evidence suggests that more men than women are dying, potentially due to sex-based
immunological or gendered differences, such as patterns and prevalence of smoking. (Wenham,
Smith and Morgan, 2020: 846)46

The caveat on this evidence is that current sex-disaggregated data is incomplete. Guan et al (2020) in a Clinical
Characteristics of Coronavirus Disease 2019 in China based data from 1,000+ patients in China found that
“41.9% of the patients were female.” (Guan et al, 2020).

From the experience of the gender impacts of the Ebola virus disease in West Africa 2014-2016, the COVID -19
pandemic would affect women negatively and disproportionately both directly and indirectly due to gender
power relations in decision making.47 During the numerous Ebola outbreaks across Africa from 1976 to 2014,
because women were traditionally the primary caregivers and responsible for preparing bodies for burial, their
vulnerability to the disease increased48 Globally women make up 70% of the workers in the health and social
sector. However, there’s an average gender pay gap of 28% within this sector, which may be worsened in times
of crises (Boniol, M., et al, 2019). In Kenya, women account for 75% of health sector workforce, 49 which
increases the likelihood that they will be more exposed to the COVID-19 infection than men working in health
sector.

Furthermore, the burden of care usually falls on women -- not just for children in the face of school closures, but
also for extended family members. As family members fall ill, women are more likely to provide care for them,50
putting themselves at higher risk of exposure as well as sacrificing their time. Women are also more likely to be
burdened with household tasks, which increase with more people staying at home during a quarantine. For
instance, Kenyan women account for 50.5% of the population51 and spend 11.1 hours on care work compared
to only 2.9 hours by men.52 Kenya’s low capacity of isolation wards at public and private health facilities and
experience in countries where the pandemic is worst – in Europe and elsewhere makes it more likely that as
infection rates rise, most cases will have to be managed at home, largely by women. Women’s tendency to be
caregivers for the sick, in both health-care settings and at home, can expose them to more infectious agents
than men53

46 Liu S, Zhang M, Yang L, et al. (2017). “Prevalence and patterns of tobacco smoking among Chinese adult men and women: findings of the 2010
national smoking survey,” Journal Epidemiol Community Health, 71: 154–61.
47 Davies, S., E., Bennett, B, (2016). “A Gendered Human Rights Analysis of Ebola and Zika: Locating Gender in Global Health Emergencies.

International Affairs, 92: 1041–60.

48 Infectious Diseases of Poverty (2017). The perspective of gender on the Ebola virus using a risk management and population health framework, a

scoping review, Available at https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5635524/

49 Ministry of Health (2014). Health Sector Human Resources Strategy 2014 – 2018, Available at http://www.health.go.ke/wp-

content/uploads/2016/04/Kenya-HRH-Strategy-2014-2018.pdf
50 Mulvihill, K., (23 August, 2014) “Why more women than men are dying in the Ebola outbreak,” Available at
https://www.graphic.com.gh/international/international-news/why-more-women-than-men-are-dying-in-the-ebola-outbreak.html
51 Kenya National Bureau of Statistics, 2019
52 Oxfam, (2019). “Gendered Patterns of Unpaid Care and Domestic Work in the Urban Informal Settlements of Nairobi, Kenya, Findings from a

Household Care Survey 2019,” Available at https://kenya.oxfam.org/latest/policy-paper/gendered-patterns-unpaid-care-and-domestic-work-

urban-informal-settlements
53 WHO (2007). “Addressing sex and gender in epidemic-prone infectious diseases,” Available at
https://www.who.int/csr/resources/publications/SexGenderInfectDis.pdf
12
Wenham, Smith, and Morgan (2020) highlights other pathways pandemics impact women as below:
‐ School closures in response to pandemics can increase women’s childcare responsibilities, as women
still bear most of the responsibility of child-rearing, also impacting their livelihoods and employment
options Women’s participation in work outside the home is likely to fall.54
‐ Travel restrictions will affect female foreign domestic workers. Of course, they also affect male
migrants.55 Korkoya and Wreh (2015) found that 70% of small-scale traders in Liberia are women, so
domestic travel restrictions during the Ebola outbreak disproportionately affected women. In Kenya,
women comprise 70% of low wage earners56. Most are employed in the informal sector or run micro and
small enterprises. This sector is characterized by daily wages, limited social protection measures and
savings, making women particularly vulnerable during health pandemics.
‐ Health resources normally dedicated to reproductive health go towards emergency response. During
the Ebola outbreak in Sierra Leone, for example, the “decrease in utilization of life-saving health
services translates to 3,600 additional maternal, neonatal and stillbirth deaths in the year 2014-15 under
the most conservative scenario” (Sochas, Channon, and Nam 2017).
‐ When women have less decision-making power than men, either in households or in government, then
women’s needs during an epidemic are less likely to be met. For instance, women constitute about 70%
of health and social workers globally yet they occupy limited decision-making positions.57

Women face greater economic vulnerability as their labour participation is often highly informal, without social
protection. Low-income women and women migrant workers are especially vulnerable;
‐ As seen in the Ebola outbreak, crises pose a serious threat to women’s engagement in economic
activities, especially in informal sectors, and can increase gender gaps in livelihoods.58
‐ UNDP´s Gender Social Norms Index showed that globally 50% of men agree that, in times of scarcity,
men should have more rights to get jobs instead of women.59
‐ Women migrant workers, especially those engaged in domestic and care work, may be adversely
impacted by global travel restrictions, with strong financial implications and limiting their ability to
support themselves and their families back home.

The COVID-19 pandemic can worsen the already high prevalence of gender-based violence (GBV) due to
greater economic stress in households in times of crisis coupled with increased social isolation. According to
WHO, London School of Hygiene and Tropical Medicine and South African Medical Research Council (2013), 1
in 3 women worldwide have experienced GBV.60 This can be further compounded by more limited access to
health care and other services;

54 See Ana Luiza Minardi, Susannah Hares and Lee Crawfurd, (2020) “Containing the Epidemic: Should Schools Close for Coronavirus?” Available
at https://www.cgdev.org/blog/containing-epidemic-should-schools-close-coronavirus
55 Of course, the distribution of migrants will vary depending on a country’s context.
56 Kenya National Bureau of Statistics (2019). Economic Survey 2019, Kenya National Bureau of Statistics, Nairobi.
57 WHO (2019). “Gender equity in the health workforce: Analysis of 104 Countries,” Available at https://www.who.int/hrh/resources/gender_equity-

health_workforce_analysis/en/
58 European Parliament A8-0281/2015. Report on the Ebola Crisis: The long-term lessons and how to strengthen health systems in development

countries to prevent future crises

59 UNDP (2020) Tackling Social Norms: A game changer for gender inequalities. Available at: http://hdr.undp.org/en/gsni
60 World Health Organization, Department of Reproductive Health and Research, London School of Hygiene and Tropical Medicine, South African

Medical Research Council (2013). Global and regional estimates of violence against women: prevalence and health effects of intimate partner
violence and non-partner sexual violence
13
 ‐ When women are primarily responsible for procuring and cooking food for the family, increasing food
insecurity as a result of the crises may put them at heightened risk, for example, of intimate partner and
other forms of domestic violence because of increased household tensions.61
‐ Other forms of GBV are also exacerbated in crises. For example, the economic impacts of the 2013-2016
Ebola outbreak in West Africa put women and children at greater risk of exploitation and sexual
violence.62
‐ Life-saving care and support to GBV survivors, often already limited services, may be disrupted as
health service providers become overburdened with handling COVID-19 cases. This diversion of
resources, coupled with gender bias and conditioning, can also impact access to other critical health
services women and girls rely upon, such as routine health checks and sexual and reproductive health
care. For example, it is estimated that at least 3,600 additional maternal, neonatal and stillbirth deaths
resulted from the diversion of healthcare resources towards Ebola in Sierra Leone between 2014 and
2015.63
‐ During West Africa’s 2014 Ebola crisis, there were reports of increased cases of gender-based violence
in Sierra Leone and service provisions for survivors were obstructed by the Ebola outbreak.64
‐ Some of these consequences have been reported in China and other countries during the COVID-19
outbreak. For instance, a nongovernmental organization assisting GBV survivors in Jingzhou received
three times more reports of domestic violence in February 2020 compared to the same month last
year.65

With all these pathways reinforcing each other, the COVID-19 pandemic would have a negative
disproportionately impact on women and girls than men and boys in Kenya.

6. Impact on Refugees, IDPs and Migrants

COVID-19 outbreaks are devastating in any context. However, the dangers of such outbreaks will be magnified
for Africa’s more than 25 million people who are forcibly displaced -- internally displaced persons (IDPs) and
refugees -- as a result of conflict and repression.66 Africa is also experiencing high levels of migration -- people
leaving their homes in search of better opportunities -- often either to Europe or urban areas where there is
more economic activity. While neither of these groups has been identified as key focal points of transmission
of COVID-19, the high densities of forcibly displaced populations and the mobility of migrants make both
groups highly vulnerable to exposure and therefore a priority for reducing the spread of the coronavirus in
Africa. This will require informed and efficient policy engagements and public messaging, as well as the
tamping down of the stigmatization and fear-based xenophobia toward these groups.

These populations are at incredibly high risk for outbreaks of contagious diseases for several reasons:

61 IASC (2015). Guidelines for Integrating Gender-Based Violence Interventions in Humanitarian Action: Food Security and Agriculture
62 UNGA A/70/723. Protecting Humanity from Future Health Crises: Report of the High Level Panel on the Global Response to Health Crises; UNICEF
Helpdesk, “GBV in Emergencies: Emergency Responses to Public Health Outbreaks,” September 2018: 2.
63 Health Policy Plan (2017). “Counting indirect crisis-related deaths in the context of a low-resilience health system: the case of maternal and

neonatal health during the Ebola epidemic in Sierra Leone,” Available at https://www.ncbi.nlm.nih.gov/pubmed/29149310
64 UNDP/Irish Aid. Assessing Sexual and Gender Based Violence during the Ebola Crisis in Sierra Leone
65Sixth Tone (2020) Domestic Violence Cases Surge During COVID-19 Epidemic. Available at: https://www.sixthtone.com/news/1005253/domestic-

violence-cases-surge-during-covid-19-epidemic

66 Williams, W., (17 October 2019). “Shifting Borders: Africa’s Displacement Crisis and Its Security Implications, “Africa Centre Research Paper No.
8, Available at https://africacenter.org/publication/shifting-borders-africas-displacement-crisis-and-its-security-implications/
14
 ‐ Their background: refugees and displaced persons likely fled from conflict, so they are starting off in
less than ideal health and likely have not had access to adequate health services. Additionally, these
populations have possibly dealt with poor nutrition prior to entering the camps.
‐ Current living conditions67: due to overcrowding and poor infrastructure, camps hardly have sanitary
places. A look at the normal ways to prevent an outbreak of an infectious disease like COVID-19 -- such
as washing hands, engaging in social distancing, ensuring good hygiene, and checking in with health
providers indicate that none are readily available in the refugees’ camps. The ability of these
communities to practice social distancing is near impossible. If the coronavirus were to get into Dadaab
and Kakuma camps, the Kalobeyei Settlement68 , the spread would be rapid69 and devastating.70
‐ Many refugees and IDPs camps are located in relatively isolated border areas. While this isolation offers
a degree of protection, there are ample opportunities for these populations to become exposed.
Government officials, aid organizations, and vendors regularly have individuals going in and out of
these camps. 71 Many within the displaced communities also travel back and forth from these
settlements while looking for work, food, fuel, or water.
‐ These populations are often not a priority for political leaders. As such, they likely will not get the
attention they require. For example,72 countries experiencing outbreaks are temporarily suspending
services to refugee camps. This is a very unfortunate , as these camps need services now more than
ever.
‐ Stigma on refugees and IDPs. If these camps get hit with an outbreak, which is likely given all the
conditions present, they become an easy target for political leaders wanting to deflect blame from
themselves. Leaders could claim the virus came from refugees, even if untrue or even if a spread is
entirely due to camps being poorly resourced, further stigmatizing this population. This can create a
vicious feedback loop where refugees and displaced persons are further marginalized, resulting in
worsening conditions in the camps and higher susceptibility to outbreaks -- which can then be used by
political leaders looking to further scapegoat displaced persons.

The is also a robust flow of informal migration that annually sees hundreds of thousands of people crossing
borders unofficially. Most are young men and women, many seasonal and day traders, all of them traveling
outside legal channels. Most informal migration is a temporary solution to a broken or undeveloped migration
management system.73 Without some form of legal recognition, people travel at their own risk. When they
cross borders for work, they remain legally, unaccounted for, and untraceable.

These informal migrants are drawn to economically vibrant -- and densely populated -- urban centres. Many of
these towns and cities have overcrowded shanty towns rising around them -- lacking proper sanitation and
running water where migrants settle in with the host community’s poor. All these residents live hand to mouth
and are unable to shelter in place, much less practice social distancing.

67 https://mphdegree.usc.edu/blog/refugee-health-from-the-public-health-perspective/
68 Kenya has some of the region's largest refugee populations, with more than 400,000 in the Dadaab and Kakuma camps, the Kalobeyei
Settlement and internally displaced people (see https://allafrica.com/stories/202003310207.html).
69https://www.nbcnews.com/health/health-care/coronavirus-could-cause-carnage-among-world-s-refugees-aid-groups-n1162861
70 https://allafrica.com/stories/202003310207.html
71 https://www.ozy.com/around-the-world/these-refugees-survived-conflict-what-about-the-coronavirus/289839/
72https://www.theguardian.com/global-development/2020/mar/11/lesbos-coronavirus-case-sparks-fears-for-refugee-camp-moria
73 Williams, W., (17 October 2019). “Shifting Borders: Africa’s Displacement Crisis and Its Security Implications,” Africa Centre Research Paper No. 8,

Available at https://africacenter.org/publication/shifting-borders-africas-displacement-crisis-and-its-security-implications/
15
Because they know they have no legal status, not only do informal migrants fear recognition at borders and
thus shun official border crossings, they also avoid drawing attention to themselves in their everyday lives.
They have not only law enforcement to fear but also the risk of violence against asylum seekers74 and informal
migrants75 from local populations spurred on by fears of the pandemic. This means that if they were exposed
to the virus or even get symptoms, they will most likely avoid seeking help or do anything to stand out. This, in
turn, would accelerate the spread of the virus.

To avoid leaving no refugees, IDPs and migrants, host governments must emphasize that this pandemic
requires a community-wide focus on public health and human security -- one that includes the most
marginalized and vulnerable. 76 This includes forcibly displaced and economic migrants, as well as the
impoverished communities that host them. Stigmatization, hostility, and persecution will further spread the
virus rather than stem it. Those who feel the need to hide their migrant status in order to work and live freely
will also feel pressured to hide exposure to the virus or any symptoms, making themselves a threat to the entire
community.

In many contexts -- especially in informal urban settlements and in camps -- counselling, good hygiene and
social distancing is not enough. Adaptations are required to increase access to soap and water. Ensuring access
to food and fuel to limit the need for inhabitants to travel outside camps is also needed based on already some
good models -- from providing public services77 (schools, clinics, and drinking water points) in informal urban
settlements, to generating public service announcements in local dialects 78 and creating community
kitchens 79 in vulnerable areas to serve millions of meals at a time. Such models should be adapted to the
context and replicated as far and wide as possible.

Migrants who have settled in urban areas should be supported as part of the overall public health effort to
contain and respond to the virus. Governments should also consider encouraging informal migrants to come
out of the shadows to be counted, and, if necessary, tested and treated without fear of reprisal, incarceration,
or deportation.

Only by identifying, isolating, and treating cases can public health leaders respond effectively to the societal
threat. Forcing informal migrants to stay in the shadows out of fear will only cause the virus to spread farther
and faster. Governments should also encourage migrants to remain where they are if they are safe. The
objective should be to reduce unnecessary movements. In this way, migrants are less of a risk to themselves
and host communities. Along the same lines, public messaging in countries of origin should also be ramped up
to discourage new migrants from departing.

7. Impact on Education
Kenya like most COVID-19 affected countries temporarily closed schools and learning institutions to mitigate
the spread of the outbreak. School closures impede learning and compound inequities, disproportionately

74 https://www.africanews.com/2019/10/31/church-rescues-stranded-refugees-manhandled-by-south-africa-police/
75 https://www.newframe.com/xenophobia-denialists-should-be-held-culpable/
76 https://www.refugeesinternational.org/reports/2020/3/29/covid-19-and-the-displaced-addressing-the-threat-of-the-novel-coronavirus-in-
humanitarian-emergencies#Africa
77https://www.usnews.com/news/world/articles/2020-03-18/no-water-no-fear-kenyas-community-leaders-step-up-to-coronavirus-challenge
78 Omolara - #Transformist #BoldLikeStellaNyanzi

@Laraoriye I made a #covid19 PSA in Ekiti dialect. I've seen that my village people have started singing and praying Corona away so I decided to
start a conversation.
79 https://www.nytimes.com/2020/03/22/opinion/restaurants-coronavirus-food-aid.html

16
affecting disadvantaged children.80 School closures during the 2014–16 Ebola epidemic increased dropouts,
child labour, violence against children, teen pregnancies, and persisting socioeconomic and gender
disparities.81 This had long-term impacts on the girls’ education, economic, and health outcomes.82

Access to distance learning through digital technologies is highly unequal, and subsidized meal programmes,
vaccination clinics, and school nurses are essential to child health care, especially for marginalized
communities. Schools provide safeguarding and supervision, and closures increase the economic burden of
families using day care or their reliance on vulnerable older relatives. Working parents might leave children
unsupervised or forgo employment to stay at home with them.

Temporary school closures can have acutely negative effects for displaced or refugee children for whom school
can provide a safe space for interaction with peers, psychosocial support, and even a reliable source of food.
When schools are closed, children’s mental health issues might be exacerbated by the lack of peer support and
alternatives for mitigation of risks.

There are reasons to be concerned because prolonged school closure and home confinement during a disease
outbreak might have negative effects on children’s physical and mental health. 83 84 Evidence suggests that
when children are out of school (e.g., weekends and summer holidays), they are physically less active, have
much longer screen time, irregular sleep patterns, and less favourable diets, resulting in weight gain and a loss
of cardiorespiratory fitness.85 86 Such negative effects on health are likely to be much worse when children are
confined to their homes without outdoor activities and interaction with same aged friends during the outbreak.

8. Impact on Food Security and Nutrition

Considering that the agricultural sector contributes 26% of (GDP), another 27% of GDP indirectly through
linkages with other sectors, employs 40% of the total population and more than 70% of the rural population in
Kenya, the impact of COVID-19 on overall economy would equally affect the agricultural and food security
sector. In this regard, there will an adverse impact on food security and nutrition. The COVID -19 pandemic
coincided with start of the planting season for maize, the major staple food. As the early season drought caused
a sharp decline in maize production in 2019 and locust pandemic this year, which is still unresolved, food stocks
are destined to decline, and prices to increase. This will have an adverse effect on poorest and the most
vulnerable segments of the population. This will be exacerbated by the travel, transport restrictions/night
curfew, fourteen (14) days quarantine for cargo vessels’ crew at Mombasa Port and stricter checks at the
country’s borders which will result in logistics problems. Furthermore, food security could be challenged if,
because of the global spread of COVID-19, some countries restrict food exports.

80 Wang G, Zhang Y, Zhao J, et al. Mitigate the effects of home confinement on children during the COVID-19 outbreak. Lancet 2020; published
online March 4. https://doi.org/10.1016/ S0140–6736(20)30547-X.
81 UN Development Programme. UNDP Africa policy note: confronting the gender impact of Ebola virus disease in Guinea, Liberia, and Sierra Leone.

2015. https://reliefweb.int/sites/ reliefweb.int/files/resources/RBA%20 Policy%20Note%20Vol%202%20No%201%20 2015_Gender.pdf

82 Kapur, “Gender Analysis,” CARE.
83 Brazendale K, Beets MW, Weaver RG, et al. Understanding differences between summer vs. school obesogenic behaviors of children: the

structured days hypothesis. Int J Behav Nutr Phys Act 2017; 14: 100.
84 Brooks SK, Webster RK, Smith LE, et al. The psychological impact of quarantine and how to reduce it: rapid review of the evidence. Lancet 2020;

published online Feb 19. https://doi.org/10.1016/S2215-0366(20)30077-8.

85 Brazendale K, Beets MW, Weaver RG, et al. Understanding differences between summer vs. school obesogenic behaviors of children: the

structured days hypothesis. Int J Behav Nutr Phys Act 2017; 14: 100.
86 Wang G, Zhang J, Lam SP, et al. Ten-year secular trends in sleep/wake patterns in Shanghai and Hong Kong school-aged children: a tale of two

cities. J Clin Sleep Med 2019; 15: 1495–502.

17
The 2014–16 West Africa Ebola outbreak demonstrates the tremendous impact that public health emergencies
can have on food systems. Movement restrictions and quarantine measures resulted in less trade of and
accessibility to food, sending prices higher at the same time that populations found themselves less able to
engage in economic activities.87 Some households were forced to use negative coping mechanisms, such as
reducing food consumption, engaging in transactional sex, or borrowing money or going into debt to pay for
food.88 Surviving Ebola and the declared end of the outbreak did not automatically ease food insecurity or
malnutrition in affected communities. Stigmatization prevented some Ebola survivors from finding or
returning to work, while lingering fears prompted some communities to deny access to food or shelter to Ebola
victims and survivors.89

The risk of heightened food insecurity and malnourishment during public health emergencies is particularly
grave for women and girls because social norms in some contexts dictate that they eat last and least. 90 When
food becomes scarce, women and girls—who are already more likely to be malnourished than men and boys91
-- could face additional health complications quickly, 92 including increased susceptibility to COVID-19
infection.

9. Impact on Governance and Security System

The Chief Justice David Maraga announced in a press statement on 15 March 2020 that court activities
throughout the country starting on 16 March 2020 will scale down for two weeks in order to comply with the
directive issued by the National Emergency Response Committee on Coronavirus. The scale down was to allow
for further consultations and design appropriate measures to prevent the spread of the coronavirus. 93 The
prisoners and persons in remand would not be presented to court for the two weeks while new arrests apart
from serious cases will be dealt with at police stations following guidelines yet to be issued by the Inspector-
General of Police. All appeals, hearings and civil cases in all courts were suspended with immediate effect. The
judicial directive would increase and worsen case backlogs. The increase in the case backlogs together with the
suspension of all hearings and mentions of all civil cases in all courts, along with all execution proceedings
would have an adverse effect on the justice system in the country.

The high level of unemployment caused by the COVID-19 pandemic94, particularly among the youth will have
an adverse impact on security of the country as it will exacerbate youth unemployment which will alienate the
unemployed youths who could be easily recruited by militant groups.95 This could exacerbate terrorist attacks,
violent extremism and youth radicalization.

87 ACAPS, (2016).” Beyond a Public Health Emergency: Potential Secondary Humanitarian Impacts of a Large-Scale
Ebola Outbreak,” Available at https://www.acaps.org/special-report/beyond-public-health-emergency-potential-secondary-humanitarian-
impacts-large-scale
88 ibid.
89 ibid.
90 UN World Food Program (WFP), “Women Are Hungrier,” Available at https://wfpusa.org/women-arehungrier-

infographic/.
91 UN Food and Agriculture Organization (FAO), “Gender and Nutrition, Available at http://www.fao. org/3/al184e/al184e00.pdf.
92 This is particularly true, and dangerous, for pregnant and lactating women, as they have additional nutritional needs. See

European Commission Staff Working Document, “Addressing Undernutrition in Emergencies,” European Commission, March 12, 2013,
https://ec.europa.eu/echo/files/news/201303_SWDundernutritioninemergencies.pdf.
93 Manyibe, E., (15 March 2020). “Judiciary Suspends Court Sessions Over Coronavirus Scare,” Available at https://www.kenyans.co.ke/news/50854-

court-sessions-suspended-over-coronavirus-scare
94 Due to its adverse impact in the key sectors of the economy.
95
As per KNBS (2020) the number of unemployed youths aged 20-24 years is 2.3 million (14.2%).
18
In order to fight the spread of the novel coronavirus, governments around the world have enacted similar
measures, from quarantines, curfews and lockdowns. Public health experts say these are necessary to save
millions of lives. But they also come with a significant loss of human rights personal liberties. In France and
Italy, people can only go outside once a day,96 armed with a permission form, and are fined97 if they do not
comply. In South Korea, health officials implemented what is known as “contract tracing”98 by tracking Covid-
19 patients using GPS data from their cars and cell phones—a significant invasion of privacy by most measures.

Like many other African countries, Kenya has imposed sweeping restrictions on movement to curb the spread
of the coronavirus. The curfew, which requires people to stay in their homes from 7pm to 5am, is the most
stringent limitation and has led to a wave of police violence. On 27 March 2020, police injured dozens of people
in a crackdown in the coastal city of Mombasa. 99 On 28 March 2020, a motorcycle taxi driver died from
injuries that his family says he sustained from being beaten by a policeman after he dropped off a pregnant
woman at a hospital after curfew.100 A 13-year-old boy died in the capital Nairobi on 30 March 2020 after being
shot while standing on his balcony as police forced people into their homes on the street.101

To contain these incidents from escalating into political violence and securitization of law and order, authorities
should ensure police respect the law and avoid abusive conduct while enforcing the curfew. Otherwise, excess
use of force could undermine government’s ability to win popular support and cooperation in an effort to
control the spread of the virus.

On the political front, the COVID-19 pandemic would disrupt the timeline of the Building Bridges Initiative
(BBI) process and the political processes around it due to restrictions on public gatherings. Prior to the first
confirmed COVID-19 case on 13 March 2020, the public hearings for the second phase of the BBI were expected
to end in mid-March, the BBI report submitted to the President end of March 2020 and the implementation of
the recommendations to commence in the summer. The implementation of the recommendations is expected
to be challenging and potentially divisive, a controversial referendum and result in new government
administrative structures. However, the cancellation of public gatherings and the government’s focus on
preventing the spread of COVID-19 seems to have momentarily paused the political tensions in the ruling
Jubilee Party. On 21 March 2020, a high-profile BBI event planned for Nakuru, which was billed as a showdown
between the two factions in the ruling Jubilee Party was cancelled due to the COVID-9 ban on public gatherings.
The development was welcomed as it prevented a potential confrontation between the two factions. Although
the BBI Taskforce will continue to receive written submissions, public consultations have been be put on hold
until further notice, the Ksh11 billion set aside by the Government for BBI rallies has been transferred to the
recently established COVID-19 Emergency Response Fund.102 Paradoxically, the coronavirus pandemic offers
an opportunity for unity amongst Kenyans around stemming the pandemic risks.

96 https://www.thelocal.fr/20200319/france-tightens-rules-on-jogging-during-coronavirus-lockdown
97 https://qz.com/1824240/thousands-are-paying-fines-for-defying-italys-coronavirus-lockdown/
98 https://www.nytimes.com/2020/03/23/world/asia/coronavirus-south-korea-flatten-curve.html
99https://www.washingtonpost.com/world/africa/kenyan-police-shot-dead-a-teenager-on-his-balcony-during-a-coronavirus-curfew-

crackdown/2020/03/31/6344c70e-7350-11ea-ad9b-254ec99993bc_story.html
100 ibid.
101 https://www.enca.com/news/kenya-president-sorry-coronavirus-cop-violence
102https://www.nation.co.ke/page/search/DailyNation/news/1056-1056-view-asGoogleSearch-

vx2vrjz/index.html?q=No+more+BBI+as+funds+diverted+ti+fight+virus&contextsIds=1148&sortBy=maupublicationdate&docTypes=%22MauArti
cle%2CMauGallery%2CMauVideo%2CCMDownload%22
19
Furthermore, the Independent Electoral and Boundaries Commission (IEBC) has postponed scheduled by-
elections in four wards ( Dabaso in Kilifi County, Kisumu North in Kisumu County, Kahawa Wendani in Kiambu
County and Taita Taveta County’s Wundayi/Mbale) and one constituency (Msabweni) because holding
elections result in exposing the public to the risk of contracting COVID-19 and the dusk to dawn national
curfew.103

10. What Policies Measures Have Some Governments Implemented and Kenyan Policymakers Can
Implement to Reduce the COVID-19 Pandemic Uncertainty and Improve Growth Prospects?
An immediate need in all countries , but especially those most affected by the COVID-19 epidemic, is for
effective public health measures that prevent infection from spreading. Well-targeted economic policies are
also required to help support health care provision and protect solvent companies and workers from
experiencing significant temporary income disruptions because of the coronavirus. A number of governments
have announced preliminary measures ranging from providing automatic rollovers of debt to small businesses
(for example, Italy and Germany) to extending unemployment insurance equivalent to nearly 100% of wages
to all laid off workers (France), extending tax deadlines for companies in affected areas and broadened the
wage supplementation fund to provide income support to laid-off workers (Italy), introducing wage subsidies
for small merchants and increased allowances for homecare and job seekers (South Korea), and temporarily
waiving social security contributions for businesses (China) (see Table 1.3).104

In their recommendations to containing the adverse impact on the coronavirus in Kenya, KEPSA (2020) has
recommended similar supportive measures to aid Kenyan businesses105. These include:

‐ Granting tax breaks to companies seeking to increase their capacity to produce import substitute
goods, which could even mean zero-rating VAT for the next 3-months;
‐ Releasing VAT refunds to assist businesses with managing their cash flow;
‐ Encouraging banks to give concessionary loans at low rates to facilitate businesses, and as well provide
moratoriums on loans that are due;
‐ Providing for a Business Stabilization Fund to cushion the impact of the coronavirus, especially for Small
and Medium Enterprises (SMEs);
‐ Reducing corporate tax for industries that have been highly affected by the coronavirus such as the
aviation industry, or waiving corporate tax for a 3-month period as well as a reduction in payroll tax for
the next 3 months for the low income bracket workers; and
‐ Strengthening the local supply chain for traders to be able to access import substitute goods.

The government has adopted most of KEPSA proposed interventions including;106

‐ Hundred percent (100 %) Tax Relief for persons earning gross monthly income of up to Ksh24,000.
‐ Reduction of Income Tax Rate (Pay-As-You-Earn) from 30% to 25%.
‐ Reduction of Resident Income Tax (Corporation Tax) from 30% to 25%;

103 Orinde, H., (1 April 2020). “IEBC postpones five by-elections due to coronavirus,” Available at
https://www.standardmedia.co.ke/article/2001366499/iebc-postpones-five-by-elections-due-to-coronavirus
104 Gopinath, G. (9 March 2020). “Limiting the Economic Fallout of the Coronavirus with Large Targeted Policies”, Available at

https://blogs.imf.org/2020/03/09/limiting-the-economic-fallout-of-the-coronavirus-with-large-targeted-policies/ and Bosio, E., Djankov, S., and

Ramalho, R., (19 March 2020). “Immediate action needed: four ideas to alleviate economic slowdowns,” Available at
https://blogs.worldbank.org/developmenttalk/immediate-action-needed-four-ideas-alleviate-economic-slowdowns
105 The caveat for Kenya though is the limited fiscal space to implement these measures.
106 https://www.president.go.ke/2020/03/25/presidential-address-on-the-state-interventions-to-cushion-kenyans-against-economic-effects-of-
covid-19-pandemic-on-25th-march-2020/
20
 ‐ Reduction of the turnover tax rate from the current 3% to 1% for all Micro, Small and Medium
Enterprises (MSMEs).
‐ Appropriation of an additional Ksh10 billion to the elderly, orphans and other vulnerable members of
the society through cash-transfers by the Ministry of Labour and Social Protection.
‐ Temporary suspension of the listing with Credit Reference Bureaus (CRB) of any person, Micro, Small
and Medium Enterprises (MSMES) and corporate entities whose loan account fall overdue or is in
arrears, effective 1st April 2020.
‐ Reduction of the VAT from 16% to 14%, effective 1st April,2020.
‐ Government payment of pending bills of at least of Ksh13 billion of the verified pending bills, within
three weeks. Equally, private sector was encouraged to clear all outstanding payments among
themselves.
‐ Expediting the payment of all verified VAT refund claims amounting to Ksh10 billion within 3 weeks.
‐ Appropriation of Ksh1 billion from the Universal Health Coverage vote to recruit of additional health
workers to support in the management of the spread of COVID-19.
‐ Voluntary reduction in the salaries of the senior ranks of the National Executive to share the burden of
the pandemic, as follows:
✓ The President and Deputy President – 80%;
✓ Cabinet Secretaries – 30%;
✓ Chief Administrative Secretaries – 30%;
✓ Principal Secretaries – 20%;
✓ Speakers of the Senate and National Assembly -30%.
‐ The Central Bank of Kenya additionally rolled out the following measures:
✓ Lowered the Central Bank Rate to 7.25% from 8.25% which will allow commercial banks to lower
the interest rate to their borrowers.
✓ Lowered the Cash Reserve Ratio to 4.25% from 5.25% which will provide additional liquidity to
commercial banks to directly support borrowers.
✓ Flexibility to banks with regard to requirements for loan classification and provisioning for loans
that were performing as at March 2, 2020 and whose repayment period was extended or were
restructured due to the pandemic.
‐ Encourage State Agencies to establish and implement frameworks for staff to work from home.
‐ All state and public officers with pre-existing medical conditions and/or aged 58 years and above,
serving in Job Group S and below or their equivalents, take leave or forthwith work from home,
excluding personnel in the security sector and other essential services as outlined in the circular issues
to the Public Service on 16th March, 2020.
‐ Re-organization of the Cabinet’s calendar, its committees and key State Agencies so as to apply a
whole-of-government approach to the COVID-19 pandemic.
‐ Introduction of co-ordination and collaboration mechanism and establishment of sectoral working
groups to more effectively and expeditiously implement action points.
‐ Establishing the COVID-19 Emergency Response Fund to mobilize resources for the emergency
response towards containing the spread, effects and impact of the pandemic.

Mitigating the impact of this severe shock requires providing support to the most vulnerable. According to
Gentilini, Almenfi and Orton, (2020) as of 20 March 2020; 107

107 Gentilini,
U., Almenfi, M., and Orton, I., (20 March 2020). “Social Protection and Jobs Responses to COVID-19: A Real-Time Review of Country
Measures,” Available at http://www.ugogentilini.net/wp-content/uploads/2020/03/global-review-of-social-protection-responses-to-COVID-19-
2.pdf
21
 ‐ A total of 45 countries have introduced, adapted or expanded social protection programmes in response
to COVID-19. Responses are present in all regions, except Africa.
‐ The most widely used measures include cash transfers (30 programmes), followed by wage subsidies
(11), subsidized sick leave (10), and various forms of subsidized social security contributions and
unemployment insurance.
‐ A total of 13 new cash transfer programmes have been introduced, like for example in Bolivia, India, Iran
and Peru. A universal, one-off cash payment to all citizens will occur in Hong-Kong and Singapore. New
in-kind schemes have also been launched, such as food vouchers in Taiwan and Seattle in the United
States of America.
‐ Countries are adapting existing social assistance programmes in various ways, by for instance:
anticipating payments of future cash transfer programmes, like in Colombia and Indonesia;
✓ ensuring additional payments, often on a one-off basis (e.g., Argentina, Armenia, Australia,
Turkey);
✓ providing more generous benefit levels (e.g., China);
✓ increasing the coverage of existing cash schemes (e.g., Brazil) and public works (Uzbekistan);
✓ enhancing agility by suspending conditionalities in the UK and Italy;
✓ providing innovative design solutions, such as school feeding programmes delivering food
directly to children’s homes or nearby centers (Jamaica and India’s Kerala state) or adapting their
financing (Japan).
‐ Income support in the form of childcare vouchers or allowances were provided in Italy, Poland and South
Korea. Other social assistance programmes include support for homeless populations as planned in
Spain; utility subsidies waiving fees for basic services are present in El Salvador; and wavers for loans
and other financial obligations (e.g., Bolivia).
‐ Many countries provide cash benefits to crisis-affected self-employed workers (e.g., Ireland, Portugal,
New Zealand) and those in the informal sector (India).
‐ Some countries (e.g., Netherland) are reducing work time among the wage employed, combined with
paid sick leave.
‐ Sweden is reducing the administrative time required for sick-leave payments, while Switzerland is doing
so for the unemployment insurance process.
‐ Delivery innovations are also emerging in Jordan (new cash programme using same registration form
of existing schemes), Japan (uploading transfers on phones), and Romania (enhanced electronic
processes for benefits).

11. Conclusion and Policy Implications

The COVID-19 outbreak in the African Region continues to evolve rapidly, with several new countries reporting
confirmed cases and an associated upsurge in incidence cases reported across the region. As of 2nd April 2020,
there have been eighty one (81) confirmed cases, one (1) death and three (3) recovered patients in Kenya. In
response, the Government through the Ministry of Health, has put in place a robust approach to address the
COVID-19 threat. As part of the response, the Ministry has constituted a National Coronavirus Taskforce to
evaluate the evolving risk and advise the Government on appropriate measures for preparedness, prevention
and response in order to mitigate the Public Health impact. The Government has also established a COVID-19
Emergency Response Fund to mobilize resources to finance pandemic response activities. Additionally, the
Ministry with support from the World Bank, WHO, UNICEF and other partners, have put together three

22
iterations of a COVID-19 costed contingency plan largely funded by the World Bank but focuses largely on the
healthcare response. The plan is guiding overall preparedness, readiness and response activities in the country.
Based on the country’s risk assessment, efforts towards COVID-19 preparedness measures have been initiated
and will continue. The measures prioritize prompt case detection, infection prevention and control, risk
communication and community engagement, point of entry screening, laboratory confirmation, quarantine
and isolation measures including mechanisms to offer effective supportive case management.

Furthermore, the government has adopted a number of containment measures, including barring entry into
Kenya from most countries (for 30 days initially, starting from 17 March 2020) except for Kenyan citizens and
residents, cancelled all public gatherings and closed schools (immediately) and universities (from 20
March 2020), social distancing and closure of most non-essential social spaces to gatherings; encouragement
of teleworking where possible; suspension of international flights (with the exception of cargo flights) and
imposition of a 14-day quarantine for those recently returning from abroad; establishment of isolation facilities;
limitations on public transportation passenger capacity and a dust to dawn curfew (from 27 March 2020).

In addition, cashless payments are being encouraged, non-essential government travel is being curbed and
prison visits were suspended for 30 days. Kenyans are advised to avoid large gatherings. County-level action
includes closing some public facilities and imposing restrictions on entertainment venues. Although private
business continues to operate, they are expected to exercise precautions measures such as setting up
quarantine zones, social distancing, provision of sanitizer facilities among others.

On 23 March 2020, the Central Bank (1) lowered its policy rate by 100 basis points (bps) to 7.25 percent; (2)
lowered banks’ cash reserve ratio by 100 bps to 4.25 percent; (3) increased the maximum tenor of repurchase
agreements from 28 to 91 days; and (4) announced flexibility to banks regarding loan classification and
provisioning for loans that were performing on March 2, 2020, but were restructured due to the pandemic. The
Central Bank of Kenya also encouraged banks to extend flexibility to borrowers’ loan terms based on pandemic-
related circumstances and encouraged the waiving or reducing of charges on mobile money transactions to
disincentivize the use of cash. In addition, the government announced on 25 March 2020 an economic stimulus
package including tax stimulus for companies, employees, consumers and SMEs, confirmation of VAT refunds
and payment of pending bills among others.

Given that the coronavirus pandemic is already having an adverse socio-economic impact on the Kenyan
economy and the impact may worsen, a whole of government and society approach is needed to avoid a full
blown pandemic which will address the following:
‐ Urgent and decisive action to stop transmission of COVID-19. Priorities on how to do this have been
clearly stated by WHO: testing every suspected case, isolating and caring for every confirmed case, and
tracing and quarantining every close contact. This response must be scaled-up, as soon as possible, at
both national and sub-national levels.
‐ Activating sectors that are critical for frontline COVID-19 response (e.g., PPE production,
communications for raising awareness).
‐ Clear and effective communication about the COVID-19 pandemic at both national and sub-national
levels.
‐ Swift responses including quarantine and broad travel restrictions for containment and adequate
preparedness by all health agencies.
‐ Promoting social distancing as much as possible to reduce community transmission.

23
‐ Increasing awareness to the public on the impact of the virus and especially on how spreading can be
curbed. As such, nationwide sensitization of citizens and businesses on sanitization initiatives and
control/prevention measures are key which will also demystify most of the misinformation around the
virus effectively control the emotional contagion.
‐ Matching the response to current phase of impact while planning for next phase, support the
procurement of local services and buying of local goods (role of public sector at national and local levels
key); ensuring investment directly in economies; supporting economic development programmes by
focusing specifically on populations most affected; finding ways to channel the recovery or crisis funds
locally through small businesses and seize creative opportunities to put small and medium businesses
to work; focusing on long term recovery plans even amidst the crisis; and ensuring technology and
knowledge is made available to local companies to innovate in the face of challenges.
‐ As both a provider of technology, innovations, skills, services, and employment, and also as a key sector
impacted by the virus, the private sector has a critical role to play. Examples include Safaricom
implemented a fee-waiver on M-Pesa to reduce the physical exchange of currency, Standard Bank
provides 90-day Coronavirus Business Interruption Payment Scheme (“payment holiday”) to small
business owners, Foxconn Technology Group (supplier of iPhone components to Apple) has refitted,
production lines to manufacture surgical masks and General Motors and medical equipment maker
Ventec have partnered to build ventilators at a General Motors plant among others.
‐ Mobilizing local agents to safeguard livelihoods and progress on the SDGs:
✓ As the range of economic activity shifts dramatically, labour, services and physical capital can be
redeployed to new ends (e.g., textile manufacturers shifting production lines to PPE, idle workers
trained to perform disinfection of public spaces, hotels converted into health units,
transportation workers providing delivery services of food and medicine).
✓ Government should operate as a powerful economic agent, with stimulus, procurement, and
digital transformation as essential functions in re-organizing the economy.
✓ Industries that are particularly vulnerable can be sustained through quickly-disbursed zero-
interest lines of credit (or grants to MSMEs) to protect employment and livelihoods.
‐ Restoring the livelihoods of employees affected by engaging in COVID-19 response through national
cash-for-work programmes in partnership with gig economy tech platforms (e.g., food delivery,
transportation).
‐ Supporting medium- and long-term business investments that lead to resilient supply chains for critical
goods and services.
‐ Building capacity for long-term digital transformations in national private sector and public services (i.e.
‘e-government’).
‐ Adapt and expand existing social protection to include social protection packages for specific MSME,
smallholder farmers and workers .
‐ Businesses adapt provision of goods and services to shifting consumer preferences and government
containment measures:
✓ Home delivery of food, medicine, consumer goods;
✓ Virtual delivery of knowledge economy;
✓ Non-healthcare producers pivot to supporting critical supply chains;
✓ Hygiene (e.g., chlorine, alcohol-based sanitizer, soap);
✓ PPE (e.g., gowns, gloves, goggles, face shields, masks);
✓ Components for hospital equipment and devices; and
✓ Hotels, colleges and schools acting as makeshift hospitals.

24
 ‐ Urban slums are hotspots for the spread of disease, and so targeting these areas of extreme poverty
through health interventions alongside other forms of sustainable development would offer a longer-
term solution to preventing the spread of future outbreaks and reducing impoverishment.108
‐ Local businesses should develop virtual workstations and enlightening employees to be prepared to
offer virtual services from their home to avoid the high risk of infection.
‐ The Government and organizations should consider the direct and indirect gender impacts of the
COVID-19 pandemic, beyond simple binary data on number of cases. This is fundamental to ensure that
Kenya’s response to the COVID-19 pandemic does not reproduce or perpetuate gender and health
inequities, gender norms, roles, and relations that influence women’s and men’s differential
vulnerability to infection, exposure to pathogens, and treatment received for it to be effective.
‐ Ensure that any movement restrictions relating to COVID-19 account for the needs of different
vulnerable groups.
‐ Prepare and put in place, when necessary, plans to ensure the continuity of education, including via
distance learning (internet, TV, radio, etc.), offering catch-up/accelerated learning opportunities,
adjusting school calendar and modality of exams (if necessary), preventing school drop-out by
sensitization and support mechanism.
‐ More investment is needed to build an even more resilient food system. Such investment must come
from national governments as well as the international community, as enhancing the capacity of
developing countries to prevent or contain a food security crisis is a collective effort. In today’s highly
interconnected world, contagious diseases such as SARS, Ebola, avian flu and COVID-19 could easily
travel across borders
‐ Develop targeted economic empowerment strategies and social safety nets to protect those who are
the worst affected and most vulnerable. These safety nets, which could be in the form of cash or in-kind
transfers (should be accompanied by intervention by health and nutrition officials, because investing in
the health and nutrition of vulnerable populations could lower the mortality rate of diseases such as
COVID-19 — as nutritional level and mortality rates are intricately linked. Social safety nets are also
crucial in the post-epidemic period to drive "reconstruction" efforts.
‐ Government should engage the private sector to explore domestic production of essential items that
were previously imported and accelerate the adoption of innovative business models and technologies
required during the pandemic. Manufacturing businesses to fill emerging gaps in global supply chains
as a result of the pandemic. This engagement should seek to manufacture as many health essentials
such as masks, sanitizers, disinfectants, and other medical products.
‐ Ensure that aid and health care workers have access to all populations in need, to accommodate surges
in health personnel and allow the transport of humanitarian and medical commodities as needed for
preparedness and response activities.
‐ Ensure that migrants and refugees, asylum seekers and IDPs are included in national surveillance,
preparedness, and response plans and activities.
‐ Maintain compliance with international human right obligations, including the rights of refugees and
migrants.
‐ Ensure that emergency preparedness and response plans are grounded in sound gender analyses,
considering gendered roles, risks, responsibilities, and social norms, and accounting for the unique
capabilities and needs of other vulnerable populations. This includes ensuring that mitigation and
response measures address women’s and girls’ caregiving burdens and heightened GBV risks.

108 Partners in Health (27 January 2016). “Study Finds Poverty Spread Ebola,” https://www.pih.org/article/study-finds-poverty-accelerated-ebola
25
 ‐ Disaggregate outbreak-related data by sex, age, and disability so that health experts can understand
differences in exposure and treatment and tailor preventive measures.
‐ Government should engage development partners to provide immediate flexibility and additional
funding to ensure that existing development and humanitarian operations can rapidly scale up and
adapt to the risks posed by COVID-19.
‐ Longer-term investments to build a stronger and more resilient health system. This makes sense both
from a health and an economic perspective. Putting more resources on the front lines to detect and
treat conditions early, before they become more serious, saves lives, improves health outcomes,
reduces healthcare costs and strengthens preparedness for when outbreaks occur.

On the business front, the COVID-19 pandemic has clearly illustrated the need for the country to explore
alternatives and diversifying the supply chains to reduce dependency on one region. The COVID-19 pandemic
has also illustrated the need for the Government to support key sectors such as manufacturing to achieve
structural transformation and industrialization of the economy.

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Eastern Africa, Kigali.

Wenham, C., Smith, J., Morgan, R., (2020). “COVID-19: the gendered impacts of the outbreak” Available at
https://www.thelancet.com/action/showPdf?pii=S0140-6736%2820%2930526-2

World Bank (2014). The Economic Impact of the 2014 Ebola Epidemic: Short and Medium Term Estimates for West
Africa (English), World Bank Group, Washington, DC.

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Table 1.1: Value of total Imports of Kenya’s Exports (US$ million), 2014-2018
2014 2015 2016 2017 2018
China 2, 838 3,284 3,336 3,813 3,622
India 3,019 2,585 2,032 1,663 1,810
EU 3,264 3,026 2,623 2,760 2,858
USA 2,140 1,495 645 1,255 839
Africa 1,668 1,526 1,387 1,957 2,012
Other Asian 5, 445 4,179 4,091 5,335 5,921
countries
Total 18,472 16,147 14,156 16,844 17,133
Source: Kenya National Bureau of Statistics, various years

Figure 1.3: Kenya's Imports by Source 2014-2018 in US$ millions

Grand Total Imports

Other Asian Countries (Total imports)

Africa

America

European Union

India

China

0 2000 4000 6000 8000 10000 12000 14000 16000 18000 20000

2018 2017 2016 2015 2014

Source, KNBS (various years). Economic Review (various years)

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 Figure 1.4: Kenya's Export Destination in US$ millions
7000
6000
5000
4000
3000
2000
1000
0

2014 2015 2016 2017 2018

Source: KNBS (various years) Economic Review (various years)

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 Table 1.2: The Macroeconomic Impacts on the Key Sectors of the Economy

Key Sectors Impact Level of Impact

The tourism sector which contributed approximately 1.3% to High
Kenya’s GDP in Q3’2019, will suffer due to lockdowns in major
economies where tourists originate
The lockdowns have seen a reduction in revenues to the
aviation industry which also greatly contributes to the
Tourism Sector tourism sector,
The cancellation of travel, business-related travels, the
meetings, conferences and exhibitions to have an adverse
effect on the is also expected to have an adverse effect on the
hospitality industry as well as the 30-day ban on public
gatherings.
Freezing of orders on fruits and vegetables to China, coupled High
with reduced orders from consumers in Europe & Middle East
thus a 46% drop in fresh produce exports
Agricultural Sector A hike in the prices of imported inputs used for food
processing and other processes, and
Reduction in airfreight volume, cancelled shipping vessels
and drop in export volumes
A shortage of intermediate goods from China used to High
Manufacturing
manufacture products will have an adverse effect on the
Sector
manufacturing sector
The health sector has had to increase its spending and direct High
funding towards public sensitization and training of medical
personnel
Health Sector
The government will have to increase its fiscal spending to
ensure hospitals are well equipped to deal with the pandemic.
The fiscal deficit is therefore likely to increase
Imports from China account for 21.% of total imports. The Moderate
Wholesale and supply chain disruption and uncertainty may also affect this
Retail Sector sector due to delays in importation, reducing customer
confidence
There will be increased caution on lending especially to Moderate
businesses that rely on imports hence inhibiting private credit
Finance and
sector growth due to the high risk of credit default, with the
Insurance Sector
possibility of an increase in Non-Performing Loans if the
pandemic is to continue
The industry is facing delays in equipment delivery from the Low
main import market China. This may cause a slowdown in the
Construction Sector growth of construction sector
Delayed payments and decision making especially from
Chinese affiliated projects

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 Postponement of projects impacting on revenues in the
industry
Delays in payments from clients and businesses that are
affected by the slowdown in economic activity, and as well
reduced funding from financial institutions
The industry has recorded delays in payment from clients in Low
Professional
China, which has in turn caused a delay in project
Services Sector
implementation having a negative impact on revenue

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Table 1.3: Measures some Governments Have Taken to Contain the Impact of COVID-19

Country Measures taken by the Government

‐ The Chancellor set aside USD 39.0 bn to boost the economy
through the Coronavirus pandemic
UK ‐ The government suspended business rates for small firms,
offered discounts for larger firms and extended sick pay

‐ The government will likely propose a payroll tax cut and a short-
term expansion of paid sick leave
‐ Passing of the Families First Coronavirus Response Act on a
USD 8.3 bn emergency coronavirus budget which guarantees
USA
free coronavirus testing, paid emergency leave, improvement
of Unemployment Insurance, strengthens food security
initiatives, and increases federal medical funding to states

‐ The government introduced tax relief for people and businesses

in the transport, tourism, and hospitality sectors to increase
consumer spending and boost the economy
‐ VAT reduction from 3.0% to 1.0% for small businesses until May
China 2020
‐ Temporary suspension of social security contributions for firms
‐ The government has also agreed to accelerate the payment on
unemployment insurance

‐ The South Korean government is providing income and VAT tax

South Korea
extensions to a majority of affected businesses
‐ The government is offering tax extensions to cash strapped
businesses
Italy ‐ Tax credits to be granted for companies which suffer a 25.0%
drop in revenues

‐ The government has made it easier for companies to claim

Germany subsidies to support workers on reduced working hours to
counter the effects of the pandemic
‐ The government announced a USD 2.9 bn Stabilization and
Support Package in order to safeguard the economy from the
disruption and uncertainties caused by the coronavirus
Singapore outbreak
‐ A Jobs Support Scheme worth USD 935.5m created to help
firms retain employees during the period of uncertainty.

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